Experts Say Classic Car Insurance Crucial

By Jeanny HopperPublished: Monday, August 24th, 2009

Most American motorists who own classic cars fail to understand the need for their vintage vehicles to have specialized protection. According to insurance specialists, classic cars require special attention especially when it comes to insurance. Unlike regular cars, the value of vintage models increase with time. This means that keeping it protected is crucial to maintain its value.

Unfortunately, half of American classic car owners take out conventional insurance policies for their vehicles without realizing the value of specialized classic car insurance. Industry sources say that most motorists simply add their vintage vehicles to their existing insurance policy when in fact classic cars deserve special attention.

Experts say that conventional insurance rates are computed based on how much a car depreciates over time. With classic vehicles however, the car’s value only increases over the years. This makes ordinary insurance coverage unsuitable for classic cars.

Car owners and classic car insurance providers typically agree to the vehicle’s replacement value. This amount is agreed upon by the policyholder and insurer based on the assessment of the car’s value. Appraisers rely on classic car auctions, vintage sales, and similar events to determine the value of a particular vehicle. If the car is destroyed for whatever reason, then the insurance company will pay the policyholder the agreed upon amount.

Contrary to popular notion, classic car insurance is actually cheaper than ordinary insurance coverage. Industry specialists say that this is because most vintage vehicles are rarely driven on a regular basis. Classic car owners usually take their vehicles for a drive every so often and most only drive their cars to and from car shows. This means that vintage cars are less at risk to get in an accident, eventually resulting to lower premiums.

To show how much more affordable classic car insurance is compare to conventional insurance, experts refer to the following example. A 1968 Camaro would cost $470 annually to insure with ordinary insurance providers provided that other factors like driving experience, clean driving records, and multiple policies are included. If a car owner declares that his vehicle is a classic car, the provider may slash up to 20 percent off, bringing the total to $380.

Classic car insurance providers, on the other hand, would charge only $290 for the same vehicle without even inquiring about a car owner’s driving records. Vintage car insurance companies rely on the car’s value and how it will be used to come up with rates. This means that the classic vehicle will definitely yield lower premiums.